Opinion · Nylaw New York
MATTER OF ATLANTIC RAYON CORP. (GOLDSMITH), 277 App. Div. 554 (1950)
100 N.Y.S.2d 849
- Type
- Opinion
- Court
- Nylaw New York
- Jurisdiction
- Nylaw
- Date
- 1950-12-05
- Topic
- general
MATTER OF ATLANTIC RAYON CORP. (GOLDSMITH), 277 App. Div. 554 (1950) 100 N.Y.S.2d 849 In the Matter of the Arbitration between ATLANTIC RAYON CORPORATION et al.,Appellants, and HAROLD GOLDSMITH, Doing Business under the Name of HARGOLDTEXTILES, Respondent.Appellate Division of the Supreme Court of New York, First Department. December 5, 1950. Appeal from Supreme Court, New York County, HAMMER, J.
Citator
UpLaw has not yet analyzed MATTER OF ATLANTIC RAYON CORP. (GOLDSMITH), 277 App. Div. 554 (1950). The absence of a flag is not a finding that it is good law.
MATTER OF ATLANTIC RAYON CORP. (GOLDSMITH),277 App. Div. 554(1950)
100 N.Y.S.2d 849
In the Matter of the Arbitration between ATLANTIC RAYON CORPORATION et al.,
Appellants, and HAROLD GOLDSMITH, Doing Business under the Name of HARGOLD
TEXTILES, Respondent.
Appellate Division of the Supreme Court of New York, First Department.
December 5, 1950.
Page 555
Where arbitrators are selected under the auspices of a trade organization and where their special skill and experience in the trade are invoked, it is, in and of itself, no disqualification that they have had business dealings with either party to the arbitration. Here, however, it appears that originally the controversy between the parties was made the basis of an action at law. That action was discontinued and the parties proceeded to arbitration. Under the practice of the trade organization which supervised the arbitration, neither of the two arbitrators (who later chose the third arbitrator) knew which party to the arbitration selected him. One of the arbitrators and the corporations in which he had a substantial interest had, as their regular attorney, the lawyer who acted in that capacity for the successful party to the arbitration. The attorneys themselves did not participate in the proceedings before the arbitrators.
The arbitrator now sought to be disqualified claims that he did not know that his attorney also represented one of the parties to the arbitration. If he had such knowledge, it was hisPage 556duty under the circumstances of this case to have disclosed it before he proceeded to act as arbitrator.
There is a further question as to whether the party now claiming to be aggrieved knew or should have known of the relationship complained of before the arbitration was concluded.
Courts are loath to sustain belated claims of disqualification after an adverse award but, considering all of the circumstances, substantial issues have here been raised concerning the knowledge of one of the arbitrators of the relationship of his attorney, to the submitted controversy and of the appellants' prior knowledge of this situation. Those issues should be referred to an official referee to hear and report thereon with his recommendations to the Special Term.
The order confirming the award and the judgment entered thereon and the order denying petitioners' motion to renew their motion to vacate the award herein should be reversed, with $20 costs and disbursements to the appellants to abide the event.
PECK, P.J., CALLAHAN and SHIENTAG, JJ., concur; GLENNON and VAN VOORHIS, JJ., dissent and vote to affirm.
Order confirming the award and the judgment entered thereon and the order denying petitioners' motion to renew their motion to vacate the award herein reversed, with $20 costs and disbursements to the appellants to abide the event. Settle order on notice. [See278 App. Div. 567.]